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So, I think this explains the scenario pretty well. Can any
of you pros tell if this is assessable or unassessable? Any
advice on how I should proceed with this? My CPA is pretty
lame so I think I'll have to find someone else.

From what you've told us, it definitely sounds unassessable. They assessed the correct amount of tax and messed up the credits, resulting in an erroneous refund. Since they have no basis for assessing additional tax, they're stuck.

This is not an everyday area of the law. Luckily, although it happens, erroneous refunds are not the norm. Thus a lot of practitioners aren't familiar with it. I strongly suggest an Enrolled Agent with an IRS Collection background. There's a searchable database of EA's at

If they sue you you'll need a lawyer, but I think a suit is highly unlikely. It's not an easy process on the government's end, and while it's not impossible, getting a suit filed in 7 months is highly unusual, especially if they're still at the correspondence stage of the process.

I'm somewhat torn here. As a taxpayer I want you to pay the money back. As a former tax collector, I think everyone should pay the proper amount. But I also recognize that the law provides specific remedies, and it's not your fault if the government can't or won't pursue them.

I leave moral considerations to you and your conscience.

Phil Marti
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